Kodak Cleanup: Trust Fund In Talks

Kodak Cleanup: Trust Fund In Talks

Kodak is working to create a fund to pay for cleanup of past environmental problems, while it works its way through bankruptcy.

Kodak
is working to create a fund to pay for cleanup of past environmental
problems, while it works its way through bankruptcy.

The
company is working with Empire State Development to create a $49
million environmental trust fund to pay for cleanup at sites like
Eastman Business Park and in the Genesee River.

It
would protect Kodak from future liability.

According
to court documents, as the end of December, Kodak reported a $96
million in environmental liabilities.

By
the end of April, the company reported that it had resolved 27 claims
but was still working to settle millions of dollars in claims with
the New York State Department of Environmental Conservation and the
Environmental Protection Agency.

Environmental
attorney Ron Hull said trust funds have become common in the last
five years during bankruptcy proceedings.

He
cited one of the largest trust funds set up for environmental
remediation as General Motors.

He
said Kodak is no different in terms of wanting to protect its
interests.

"That
would assure the obligation and then the agreement would be the
company is discharged from its obligations as far as the state is
concerned," said Ron Hull, Senior Counsel at Underberg &
Kessler.

If
the settlement happens, Kodak's responsibility for historical
environmental impacts at Eastman Business Park would become the
responsibility of the EBP Trust.

Court
documents said this would help speed-up the re-development pf that
site.

The
trust fund would be made up of $23 million contribution existing
financial assurances from Kodak and another $26 million from the sale
of the park utility infrastructure to Recycled Energy Development,
LLC.

Kodak
spokesperson Chris Veronda said the trust is still in negotiations
and nothing is yet concrete.

Would
the trust cover all future environmental liabilities?

Hull
said if it runs out of money, then taxpayers would likely have to
fund it.

Veronda
said in a statement, "It's also quite possible that there could be
excess funds that the state would get to keep and could commit then
to other purposes once it was clear that the money was not needed to
address additional remediation issues."

Kodak
also said it has been working to clean up many past problems.

"For
example, in the case of contaminated groundwater, there are water
flow control systems in place surrounding areas of contamination that
ensure that the flow of groundwater is back into the EBP site, not
away from it. And on site is a network of some 800 monitoring and
pumping wells that draw contaminated groundwater out of the ground
and send it to our waste-water treatment plant. These systems have
helped to greatly reduce the levels of contamination present over the
years," said Veronda.